Blue Shield of California and Magellan: A Deceptive Arrangement
By Barbara Griswold, LMFT
(June 8, 2015)
Let’s look at a common scenario for California mental health providers: A client calls, telling the therapist she has Blue Shield coverage, wanting to know if the provider accepts her insurance. The therapist says yes, since he is a Blue Shield provider. But the therapist’s claim is denied. It turns out this client’s care is handled by Magellan Behavioral Health, and the therapist is not a Magellan provider. This leaves our unhappy provider with hundreds of dollars of unpaid therapy bills.
What is this all about? You may know that many medical health insurers “carve out” their mental health benefits, meaning that they hire another company to manage the mental health portion of their insurance plan – to do clinical reviews and pay claims. In our example, as of January 1, 2012, 1.9 million of Blue Shield’s mental health services and EAP services were carved out to Magellan.
But here’s the part that enrages me. When insurance plans carve out their care it is typically reflected on the client’s insurance card, where it might say “Mental health and substance abuse handled by ABC Insurance” followed by contact information. It is clear and transparent. Blue Shield does not disclose this, either on the insurance card or even on the phone. The card – and even the provider rep on the phone — may say “Mental health services are handled by BSMHSA.” Many providers don’t know what this stands for, or may think it stands for “Blue Shield Mental Health and Substance Abuse.” It actually stands for “Blue Shield Mental Health Service Administrator.” But bottom line, Magellan is never mentioned, giving the impression to clients and providers alike that services will be covered with a Blue Shield provider. I feel this is deceptive, and I feel there is grounds for appeal and complaint to the State Dept. of Managed Care) if your claim is denied for this reason.
Just to make it more complicated… Not all of Blue Shield of California’s clients are carved out to Magellan. Many accounts are still handled by Blue Shield. That means I have some Blue Shield clients that Blue Shield manages, and some that Magellan manages, but their cards look remarkably similar. It’s also important to remember that at any time, Blue Shield may change who it chooses to manages its mental health.
This drives home the point I’m always trying to make: Always, always, always call the insurance plan before you start treatment. If the plan says this client is handled by the BSMHSA you will know that they are referring to Magellan, and you will need to be a Magellan provider to be reimbursed as an in-network provider. (For a complete list of questions you need to ask on that phone call, my book has a “Checking Coverage: 13 Essential Questions” Worksheet. To order the book, click here.
Barbara Griswold, LMFT, is the author of Navigating the Insurance Maze: The Therapist’s Complete Guide to Working with Insurance – And Whether You Should. To purchase the book or other resources for therapists, click here. Contact Barbara at email@example.com to get answers to your insurance questions.
Copyright 2008-, Barbara Griswold, LMFT. No part may be reproduced without written permission of the author.